He had been given a bye to the last 16 in Brisbane and was due to play American Ryan Harrison on Thursday, but said he is not fully fit.
The 30-year-old’s decision will cast doubt on his participation in the Australian Open which starts in Melbourne on 15 January.
The Scot, who has not played since being knocked out of Wimbledon in July, has dropped to 16th in the world rankings.
Murray is the latest high profile withdrawal from Brisbane, joining Rafael Nadal, Bernard Tomic and Garbine Muguruza on the sidelines.
The number one women’s seed retired in her opening match after suffering severe cramps.